How many credit cards should NRIs own?

Do you own more than one credit card? Perhaps you’ve been saying yes to all those so called lifetime free cards. Credit cards can be a great financial tool if used responsibly but can prove to be disastrous if handled carelessly. So what’s the ideal number of cards one should own? And what are the ways to manage them?

According to experts you can own multiple credit cards and make the most out of the free interest period, the reward points, the discount offers that come along provided you are smart enough to pay up your total outstanding on the due date.

Says Jeet Shah, certified financial planner, “To play safe, keep two credit cards. And segregate your expenses on the basis of small and big time purchases. Preferably keep one card for buying grocery, clothes among others at supermarkets and utilize the other card strictly for high end purchases that can go over Rs 25,000/- such as a home theatre, a TV set, computer and the like.”

Managing multiple credit cards also means keeping track of the due date, interest free period, the maximum credit limit among others. But then there are other benefits too. For instance you can easily split the huge cost of big ticket purchases between two cards. That way you don’t have to worry about exceeding the maximum credit limit on one card.

Do you roll over credit? Stop right away: But if you lose track, the repercussions can be huge. If you’re an impulsive buyer, chances are you’d simply go on a shopping spree not giving a thought to the huge bills. You may start postponing your payment and soon over a period of time you’ll realise that you’re already neck deep in debt. To avoid such situations, simply pay up your dues fully on your due date. And yes, keep away from rolling over credit.

Good credit paying history? Expect rewards galore: Also, considering your good payment history, your credit card issuing company may choose to reward you by increasing your credit limit. Which means, rather than go in for multiple cards you can easily get an increased credit limit on your existing card. So use credit responsibly and rake in the most from your credit card.